The third postcommunist parliamentary elections, held on May 26, 1996, plunged Albania into its deepest political crisis since the demise of communist rule in 1991. The opposition, led by the Socialist Party (the former Communist Party), charged that Pres. Sali Berisha’s Democratic Party of Albania (DPA) used intimidation and fraud to capture a large election majority. Riot police violently broke up a protest rally, and the opposition parties boycotted all further activities related to the national elections, giving the DPA de facto control over the People’s Assembly, the executive, and the judiciary.

On July 11 a new Cabinet was formed comprising 16 ministries (1 without portfolio), 7 state secretaries, and 1 Cabinet secretary-general. The enlarged new executive body had four female members, the widest female representation in the history of the country.

Gross domestic product (GDP) grew by an estimated 8%, while inflation rose by about 4-5%, mainly owing to the introduction of a value-added tax. Unemployment dropped to a total of 170,000, or about 13%. The agricultural and especially the construction and private-service sectors continued to register robust two-digit growth. The Albanian economy nevertheless remained unproductive, since GDP was primarily attributable to the growth of small businesses and not to industry. Remittances from Albanian émigrés in Greece, Italy, Germany, and the U.S. still accounted for an estimated 20% of GDP. Early in the year Albania received an aid package from the U.S. worth $100 million.

The nation’s relationship with Greece was improved when a high-ranking Greek official visited Albania, and a number of important cooperation agreement were signed. The impasse between Tiranë and Belgrade continued, although ethnic Albanians from Kosovo were allowed to travel to Albania. Tiranë dispatched a 33-man peacekeeping force to the German contingent of IFOR (the NATO-led Implementation Force) in Croatia, the first time in the country’s history that Albanian troops had been stationed abroad. Louis Zanga